Decommissioning expenditures

Decommissioning constitutes the final stage of an OWF’s lifespan when the generation and transmission assets are removed from the site with respect to the surrounding environment. The exploited site must be left in as close to the original condition prior to the deployment of the project (Topham and McMillan, 2017). Decommissioning is an emerging practice in the offshore wind industry. To date, only a few small-scale OWFs have been decommissioned.

Table 7 displays details about seven OWFs decommissioned across Europe by 2019.

Table 7 Decommissioned OWFs in Europe by 2019 (1C Offshore, 2019; Adedipe and Shafiee, gained consent and legislation of the country where the farm was commissioned, utilised assets and their state by the end of the lifespan, the site’s characteristics, among other factors. In the current decade, the number of decommissioning activities across European countries and worldwide is expected to grow substantially. The typical portrayal of an OWF, which will be decommissioned in this timeframe, is a relatively low-scale farm with a few small-sized turbines installed on monopile foundations in water depths not exceeding 50 m. Such farms will provide a learning opportunity to practice decommissioning activities in “easy” environments, before the operation life of large-scale OWFs come to an end (Topham and McMillan, 2017;

Adedipe and Shafiee, 2021). The strategies for the current and upcoming large-scale OWFs, especially with installed capacity over 1,000 MW and located at a great distance from shore, are still developing and thus uncertain. Moreover, available equipment and legislation may change significantly in the long-term perspective, making a fair valuation of decommissioning costs and time extremely challenging (Scottish Enterprise, 2017; McAuliffe et al., 2019). Figure 28 represents decommissioning expenditures (DECEX), estimated by the Scottish Enterprise.

Figure 28 Breakdown of the costs within the decommissioning sub-element (Scottish Enterprise, 2017, modified by author)

As it was stated earlier, the estimated cost for decommission makes up 4% of the lifetime expenditures of an OWF (Scottish Enterprise, 2017). To be able to decommission the farm, the owner has to collect a portion from the receiving cash flow into the related fund during the operational phase, in which the point of the “middle life” is observed as the best time to start.

In the first half of the operational phase (10-15 years), the risk of default is higher due to lack of experience, as well as the possibility of the owner being burdened with debts and other financial liabilities. Experience in the O&G industry shows that decommissioning costs may increase significantly beyond original estimations, exposing the government and owner to unforeseen liabilities. Thus, well-evaluated risks and decommissioning funds will ensure that the owner is capable of covering any financial complications, which may incur in the future (Climate Change Capital, 2010).

Before gaining approval for commissioning an OWF, the initial decommissioning strategy must be already submitted to the appropriate regulatory body owned by a national authority.

Subsequently, the strategy is revisited and reviewed on a regular basis along with the project lifespan (Topham and McMillan, 2017). The decommissioning strategy of an OWF includes complete or partial removal scenarios of sub-elements for further reuse, recycling and repurposing (if possible). Adedipe and Shafiee (2019) explicitly described complete removal

of an OWF, dividing the process into four stages: (1) planning and regulatory approval; (2) execution; (3) logistics and waste management; and (4) post-decommissioning. These stages and their activities constitute DECEX and are presented successively in Figure 29.

Figure 29 Breakdown of decommissioning activities (Adedipe and Shafiee, 2021, modified by author)

Partial removal entails dismantling some components, while others are left in situ, such as the foundation piles and transmission cables. In both cases, the site must be returned as close to its original condition as possible, including post-decommissioning activities such as site surveying, clearance and monitoring. Waste management is another crucial aspect of decommissioning, as all removed components and waste material must be recycled or landfilled safely in accordance with legislation. Steel-made components can be easily recycled, whereas other components related to OWTs are typically made of composite materials and, therefore, are challenging to recycle (Adedipe and Shafiee, 2021). Although there is not much governmental regulation and overall little decommissioning experience, it is anticipated that strategies and other legal frameworks for offshore wind will be employed similarly to mature O&G due to the high synergy between the two industries. Nevertheless, O&G service suppliers might face challenges to perform decommissioning due to the more extensive geographical area of OWFs while being influenced by unpredictable weather conditions (Scottish Enterprise, 2017; Topham and McMillan, 2017).

When an OWF reaches the end-of-life (EOL) phase, there are two more alternatives, life extension and repowering, which aims to expand service life rather than terminate the farm’s operation and decommission (Adedipe and Shafiee, 2021). These alternatives are presented in Figure 30.

Figure 30 EOL strategies for OWFs (Shafiee and Animah, 2017; Adedipe and Shafiee, 2021, modified by author)

Life extension aims to prolong the lifespan of an OWF, with the economic profit that implies.

Within the complex engineering system, such as an OWF, sub-systems and their components have a different expected operational life. Most OWTs are designed to last for about 25 years before upgrading or being replaced (Adedipe and Shafiee, 2021). With proper maintenance, OWTs might still have a few years of further operation with lowered electricity output. Other sub-elements of an OWF have a longer operational life. Depending on the type, foundations can last over 100 years, which is the case for gravity bases. The inter-array and transmission network can be in use for around 40 years, while transformers can last up to 35 years (Hou et al., 2017; Topham and McMillan, 2017). The life extension strategy has been completed in related, nuclear power and O&G sites, and non-related industries, transportation and defence (Shafiee and Animah, 2017).

Repowering is a new and yet to be implemented strategy in the offshore wind industry, which involves renewing OWTs with new and improved design in the same location by keeping most of the existing infrastructure intact. Within repowering, there are two options:

• Partial repowering is a similar strategy to life extension, which involves replacing minor components of an OWT, such as rotors, blades and power electronics.

• Full repowering is a strategy that aims to replace or rebuild out-of-use OWTs with modern units with larger rated power, which are able to obtain higher energy efficiency.

However, due to the increased weight and output of newer and often larger OWTs, more substantial foundations and transmission assets might be required (Hou et al., 2017;

Topham and McMillan, 2017).

Both life extension and repowering are considered sustainable options to prolong the lifespan of an OWF without involving significant investments or causing substantial harm to the surrounding environment.